Kroger hires real estate firm Jones Lang LaSalle to sell or lease Kroger closed stores in effort to reduce costs; Kroger also evaluating purchasing stores in key locations

CHICAGO , July 18, 2011 () – The Kroger Co., the nation’s largest traditional grocery retailer, is undertaking an initiative with Jones Lang LaSalle to conduct a strategic review of a select group of its retail assets, in tandem with Kroger’s divisional real estate teams, to explore optimization strategies for a select portfolio of the retailer’s operating leased stores in light of the currently advantageous real estate and financial market conditions. In addition, Jones Lang LaSalle has been selected, among others, to participate in developing disposition strategies for a portion of the retailer’s closed store portfolio.

Jones Lang LaSalle has been assigned to manage the disposition of a group of Kroger closed stores as part of a carefully orchestrated strategy to either sell or lease these well-located buildings in an effort to reduce costs. Kroger is also evaluating purchasing stores in key locations in order to provide long-term stability within core markets. The initiative also includes evaluating debt loads and working with lenders and special servicers on Kroger’s behalf. The firm’s investment grade status and willingness to sign longer-term leases enables it to reset or stabilize the value of the centers it is located within.

Jones Lang LaSalle has assembled a team of experts to lead the execution of Kroger’s strategy including Emil Gullia, Tom Turley, Guy Ponticiello, Joe Brady, Geno Coradini, and Brian Leonard.

“This is an astute move and the right time for both landlords and strong investment grade tenants to engage in mutually advantageous solutions,” said Emil Gullia, CCIM, Vice President, Jones Lang LaSalle. “Kroger’s devotion to exceeding its customer’s needs means being in the right location, with the right service offering, for the long term.”

Added Emil, “This culminates in stabilizing shopping centers with longer terms leases and improved consumer services within that center. A restructuring program of this magnitude benefits all of the stakeholders – the consumer, the tenant and the landlord,”

“Kroger has a long-standing relationship with and a strong commitment to the landlords of its leased stores, and strategic targeted lease restructuring will deliver value to all parties involved, including ownership, co-tenants, and its customers,” added Tom Turley, Executive Vice President at Jones Lang LaSalle “Our aim is to create mutually beneficial long-term lease solutions that not only ensure these shopping centers and their customers retain the best grocery anchor tenant but that owners and lenders continue to have well-performing retail assets on their books.”

Jones Lang LaSalle’s initiatives are in support of Kroger’s long-term operational goals as part of the grocery chain’s strategy for growth. The grocer has a sustained commitment to be an innovator in the customer grocery shopping experience and will be expanding in-store services, remodeling its store interiors, and adding pharmacies and fuel centers to select locations.

For more information on the Jones Lang LaSalle initiative with Kroger, please contact Emil Gullia in Corporate Retail Solutions at (678)-429-3575 or Emil.Gullia@am.jll.com.

Jones Lang LaSalle’s Corporate Retail Solutions team provides a full range of outsourced real estate services for its retail clients, managing both their new store rollout process and their existing store portfolio. Jones Lang LaSalle is in its third year of building a robust and comprehensive service offering for retail tenants/occupiers following the firm’s acquisition of The Standard Group in 2008.The team’s portfolio of clients includes financial institutions; sporting goods and electronics retailers; and automotive, grocery and furniture stores. Over the past 18 months, the practice has nearly doubled in size and tripled the number of clients it serves.

About Jones Lang LaSalle
Jones Lang LaSalle (NYSE:JLL) is a financial and professional services firm specializing in real estate. The firm offers integrated services delivered by expert teams worldwide to clients seeking increased value by owning, occupying or investing in real estate. With 2010 global revenue of more than $2.9 billion, Jones Lang LaSalle serves clients in 60 countries from more than 1,000 locations worldwide, including 185 corporate offices. The firm is an industry leader in property and corporate facility management services, with a portfolio of approximately 1.8 billion square feet worldwide. LaSalle Investment Management, the company’s investment management business, is one of the world’s largest and most diverse in real estate with more than $43 billion of assets under management. For further information, please visit our website, www.joneslanglasalle.com.

About Kroger Company
Kroger, the nation’s largest traditional grocery retailer, employs more than 334,000 associates who serve customers in 2,468 supermarkets and multi-department stores in 31 states under two dozen local banner names including Kroger, City Market, Dillons, Jay C, Food 4 Less, Fred Meyer, Fry’s, King Soopers, QFC, Ralphs and Smith’s. The Company also operates 784 convenience stores, 372 fine jewellery stores, 932 supermarket fuel centers and 40 food processing plants in the U.S. Kroger, headquartered in Cincinnati, Ohio, focuses its charitable efforts on supporting hunger relief, health and wellness initiatives, and local organizations in the communities it serves. For more information about Kroger, please visit www.kroger.com.

* All content is copyrighted by Industry Intelligence, or the original respective author or source. You may not recirculate, redistrubte or publish the analysis and presentation included in the service without Industry Intelligence's prior written consent. Please review our terms of use.

Related News:this box contains exclusive content that is accessible only to Industry Intelligence subscribers. Click a link to learn more.